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News: Ethiopian Communications Authority extends deadline for second telecom license

Balcha Reba, director general of the Ethiopian Communication Authority (Photo: ENA)

Addis Abeba – The Ethiopian Communications Authority (ECA) has announced a 20-day extension for submitting requests for qualification (RFQ) for the coveted second full-service nationwide telecommunications license.

Initially, the RFQ submission date was set for 15 September, 2023. However, the ECA said it has received concerns and requests from several prospective investors to extend the deadline for RFQ submission. The authority fully concurred with these requests and, as a result, has pushed the deadline to 6 October, 2023.

The latest announcement has raised concerns about the authority’s ability to execute its plan to grant the much-awaited second telecommunications license by the end of 2023. Only a month ago, Balcha Reba, the Director General of ECA, confidently stated that all the essential groundwork for the second license tender process had been finalized. However, this recent announcement casts doubt on the authority’s readiness to proceed with the licensing procedure as scheduled.

The authority unveiled its request for qualifications (RFQ) on 30 June, 2023, and set a submission deadline of 15 September, 2023. Balcha announced that upon receiving bids, the next phase of the licensing process, the request for proposal, would commence. This second phase was estimated to last two to three months, potentially paving the way for the issuance of the third license in either November or December 2023.

Reports have indicated that only a select few global companies have expressed interest in becoming the third telecom provider in Ethiopia. One such renowned company is the French telecommunications giant Orange, which has also shown interest in bidding for a minority stake in the Ethiopian telecom market. Following the reinstatement of the tendering process by the government in November, international telecom operators were invited to showcase their interest in this endeavor. Alongside Orange, E&, the UAE’s largest telecom operator, is also contemplating a bid for a substantial 45% stake in Ethio Telecom.

Having secured one of the two licenses opened to private telecommunication operators in May 2021, Safaricom Ethiopia has emerged as the second telecom provider. Its successful bid of $850 million not only granted Safaricom Ethiopia the license but also obligated the company to invest a whopping $8.5 billion within a span of ten years. An additional milestone was reached by Safaricom Ethiopia when it became the second operator to introduce mobile money services following the acquisition of its license in May 2023. AS

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